Offshore gaming buoys PH real estate
By Amy R. Remo, 09-22-2018
They are emerging as a strong force in the local real
estate market, significantly driving demand across
The influx of offshore gaming companies-many of which are
Chinese, thanks to the warmer relations between Manila and
Beijing-has notably spurred demand for office spaces in the last
year or so, even cushioning the slowdown in take up by the business
process outsourcing sector in 2017.
Consequently, the growing presence of these so-called POGOS
(Philippine offshore gaming operators) has seen the arrival of many
Chinese investors and employees looking for residential spaces
across the metro.
Evidently, POGOs are now one of the biggest disruptors of the
Philippine real estate landscape, particularly in areas where they
"For residential developments, the POGO market represents one of
the newest and most significant changes in the real estate
industry. The growth of the POGO industry has been quite strong and
this has spurred a lot of take up for residential units. If we take
a look at the vacancy rates in Metro Manila, generally, they are
going down and much of that is because of the POGO industry,"
Ortigas & Co. COO Thomas Mirasol said in a briefing hosted by
"The big difference between what has happened in residential
real estate in recent years vs. in previous years is that we did
not have many new residents coming in. Essentially, what we had
were the effects of growing population… In recent years however, we
had this influx in the POGO market where people by the thousands
are coming over and they are taking up residence… This has
spurred a new demand for residential real estate," Mirasol
Data from Colliers International Philippines showed that vacancy
rates in the Makati central business district, Fort Bonifacio,
Rockwell Center and Ortigas Center all declined in the second
quarter due not only to stronger leasing from foreign and local
professionals working in CBDs, but as to the Chinese investors and
workers employed by offshore gaming companies.
A concrete proof of this growing residential demand due to POGOs
can easily be seen in the rising take up of office spaces by these
There are reportedly 51 offshore gaming operators in the
Philippines as of June, and most are located in the Bay Area,
occupying office spaces ranging from 10,000 to 30,000 sqm.
Michael McCullough, managing director of KMC Savills, disclosed
that office take up of POGOs last year reached some 400,000 sqm.
For 2018, they expect the same take up, bringing the total to some
800,000 sqm in the last two years.
McCullough shared that if you estimate one person to occupy
every 5 sqm, that will be equivalent to some 160,000 individuals
potentially working in these facilities.
Admittedly, there is a certain risk that goes with leasing to
foreigners employed by these gaming companies. Some had expressed
fears about its sustainability, thus prompting several developers
to limit their acceptance of POGOs.
"Managing property that has POGOs can be quite a bit of a
challenge but it's really been a huge opportunity for landlords and
for a couple of areas like Makati and Pasay," McCullough said.
"Ten years ago, we saw something similar happen. It was not POGO
but the immigration from another Asian country. When that wave
happened, there were similar concerns. But now, no one talks
about it, because that group has successfully assimilated
themselves to the Philippine culture and I think we will see the
same thing with many of the POGO users," Mirasol further noted.
On another development, Lamudi Philippines CEO Bhavna
Suresh meanwhile announced that they are already halfway through
their survey for the second edition of The Outlook, which is being
co-presented by the Property Section of the Philippine Daily
It can be recalled that all nominations for The Outlook would go
through an esteemed panel of judges, who lent their expertise in
identifying which projects and developers made the biggest waves in
Philippine real estate this year. The shortlisted nominees would
have to go through some 10,000 property seekers, based on their
search interests, to determine the winners for each category. The
only exception would be the nominations for the Special and
Personality Awards, which were screened only by the judges.
At present, Lamudi has already surveyed some 5,000 property